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Application of Porters Five Forces on Construction Sector - Research Paper Example

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This paper discusses an analysis of construction industry and the two firms, Balfour Beatty and Carillion with the help of Porter’s five forces it can be said that the profits in the industry are mainly affected by the power of bargaining of the buyers and rivalry among the existing competitors…
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Application of Porters Five Forces on Construction Sector
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Download file to see previous pages The work includes the building of roads, bridges and other major infrastructures. The real estate business is also urban-based; so the constructions companies need to base all their business activity in urban areas in order to complement the real estate industry. The repair and maintenance of existing buildings and other infrastructures also fall under the domain of the construction industry and its major business comes from the densely populated urban areas. This is due to the fact that the more usage of infrastructure in densely populated urban areas results in higher damages and hence is subject to repair. There are mainly three categories in which the construction industry is divided. First, being the heavy constructions that require high civil engineering; in this category, we have the construction of roads, bridges and other big infrastructures. In this category, the big guns of the construction industry come into a function for all major commitments. The second category is the general construction of buildings of real estate; in this category, the construction companies operate in housing development works. The small construction companies mainly operate in this category, as it requires small budgetary involvements. The third and final category comprises of special constructive work, which is done on a small scale. Specialized areas of construction fall in this category like the construction work on wood, electric related works, etc. In this category, very specific construction companies operate as it requires specialization in a specific field of work. (Economy watch, n.d).
It is seen that the contractor may be an individual or any organization; contractors definitely fall in any of the above categories in the construction business. A construction firm, of any size, can fall under these three categories of the construction business.   ...Download file to see next pagesRead More
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